Harnessing Managerial Knowledge to Implement Product-Line Extensions: How do Mutual Fund Families Allocate Portfolio Managers to Old and New Funds?

This study investigates the conditions under which managers are shared across old and new product lines. Results from a longitudinal study of product-line extension in the mutual fund industry showed that fund families with portfolio managers who had experience in funds related to the investment objective category of the new fund were more likely to staff these funds using a shared manager. In addition, we found a +/- relationship between the extent of utilization of related portfolio managers and resource sharing. Further, the task complexity of the new fund conditioned the relationship between experience, utilization and resource sharing.